American Bridge 21st Century Foundation’s 1024 application materials could be yours!

Forget that new 64GB iPhone 5s (about $399, plus tax) or cancel your next 54 months of Netflix (about $431 at current rates) or forgo gas for a couple of months, and you too could have all 2,143 pages of official correspondence between the IRS and American Bridge — a volume that documents American Bridge’s inspiring journey from self-declared 501(c)(4) social welfare organization to IRS-recognized 501(c)(4) social welfare organization!

But, wait, there’s more!

For a limited time, the application materials come in two complimentary accordion folders for easy portage to the beach, the pool, or your neighborhood BBQ. That’s right, thousands of double-sided pages of IRS application materials all stored in two tasteful accordion folders for less than $500!

We at the Center for Responsive Politics know you’re excited to take advantage of this once-in-a-lifetime opportunity. In fact, we’ve so thoroughly enjoyed reliving the harrowing tale of American Bridge 21st Century Foundation’s 1024 application process — wait till you get to the Articles of Incorporation! — that we want to explain how you can get your hands on these unforgettable documents. (Hint: It involves paying a high-powered law firm more than half of what the average American makes in a week)

There may be some of you out there (nerds) who are wondering why a 1024 is worth your hard-earned money. Can you cut pennies or soda cans with the application materials? Can you use them to get that guacamole stain out of the futon in your parents’ basement? Will they hide your 5 o’clock unibrow?

Good questions! The answer to all of them is “Maybe!” (And then, no.)

What makes these documents really amazing, though, is that they show how the IRS has dealt with politically partisan 501(c)(4) applicants like American Bridge. The 1024 is the document groups like these submit to get the official IRS nonprofit seal of approval — giving them an aura of legitimacy that is veryexciting for donors. In this case, we wondered whether the IRS asked the group to explain how cultivating opposition research on Republican candidates — its main activity — fit the social welfare mold; groups in that category aren’t supposed to be mostly devoted to political activity.

American Bridge and its super PAC affiliate have made their mark providing fodder for Democratic candidates and liberal groups who need gaffes or embarrassing quotes with which to bash their Republican opponents. The 501(c)(4) arm has raised $5.4 million since its founding in 2011, but none of that has gone to hiring employees or recruiting volunteers. Instead, the organization does online what the super PAC’s “campaign trackers” do in the field: Dig up dirt. The posts on the group’s website are broken into issues like “immigration” or “economic growth” and tagged with the names of “Conservatives,” providing easy access to information that can be used in attack ads or fundraising pitches.

(SPOILER ALERT: Though the IRS took nine months to approve American Bridge’s status, it didn’t actually ask the group any questions.)

The monetary value of many items, as any economist would tell you, correlates with their scarcity. Form 1024s are the white truffles of IRS documents. That’s because the materials are only fully public once the IRS has approved them, and it’s difficult to know when the IRS has actually approved a group’s application.

We’ve tried to demystify this issue at CRP by setting up procedures that monitor the small bits of IRS data that are public to learn when organizations are recognized and, therefore, must provide their 1024 materials. Once we know an exemption has been granted, there are two places to get the paper: The IRS or the group itself.

Though this flowchart focuses on annual 990 returns — the most commonly requested documents — the process for obtaining 1024 materials is similar.

The agency makes the request process comically difficult — so much so that it almost makes the process for obtaining annual 990 forms for these groups (filed annually and containing some basic financial information) seem reasonable (well, not really; see flowchart). The only way to get 1024 materials from the IRS is to print out a form 4506-a, fill it out, then fax or mail it to the proper IRS office. If the IRS doesn’t lose the request — which has happened to CRP on a couple of occasions — staff will review it, and then send hard copies of the requested document right away (J/k! They send it in 30 to 60 days). There is no way to receive the requested documents electronically — presumably because that would take all of the fun out requesting them.

The IRS process for providing documents is almost perfectly summed up by the Mandarin idiom 脫褲子放屁 (“taking your pants off to fart”). It’s completely unnecessary, as the entirely searchable 527 section of the IRS website proves.

Of course, none of this comes as a surprise to anyone who already knew that the IRS provides annual 990 returns on monthly DVDs that come in the mail at a cost of thousands of dollars (read that sentence three more times to let it sink in). But in the case of 1024 materials there isn’t even a DVD-of-the-month club.

In addition, the IRS won’t talk about the documents. We proved this, by accident, when we called just to confirm the number of pages in American Bridge’s 1024 application materials.

We spent more than an hour-and-a-half listening to the dulcet piano soundscapes of IRS hold music (we call it “Internal Revenue Serenade”). Long story short, the IRS confirmed that we were 90 minutes closer to the cold grip of the grave with nothing to show for it. An unusually friendly customer service rep told us that the only way for us to know the number of pages in American Bridge’s 1024 application would be to request the entire document from the IRS and count the pieces of paper.

And here’s the cherry on top: The IRS charges for hard copies of these public documents that it doesn’t make available in a searchable database online. For noncommercial users, the agency will send the first 100 pages free; each page after that costs 20 cents.

But as with good wine or the placebo effect, you need to pay full price to truly appreciate the beauty of a 1024. For that, we needed to go to American Bridge itself, which makes it really easy to pay (Hint: By forcing you to. Because IRS regulations allow it to).

On April 15, 2014, we sent a letter to Rodell Mollineau, then the president of American Bridge and a former staffer of Senate Majority Leader Harry Reid, requesting the group’s application materials, preferably in electronic form. On April 24, a Perkins Coie attorney we’ll refer to as Ezra R. — no, E. Reese — who represents the group, responded to our request, saying in an email that, yes, the group had received an exemption from the IRS, but “as a matter of policy, American Bridge 21st Century Foundation only issues paper copies of its 1024 application.”

We asked some of the nation’s top nonprofit lawyers whether there’s any legitimate reason for a well-funded nonprofit like American Bridge to have a “policy” of printing a document from an electronic file, then mailing it to a requester — other than to make it as difficult as possible for that requester to obtain and process the document. The consensus was that American Bridge probably knew it was going to be hard for us to scan thousands of double-sided pages.

American Bridge is not the only organization with a hard-copy policy, nor is it the only one that charges for paper copies of documents we’d prefer to receive in PDF form. It’s just the only one to charge us this much money for this much paper with this much drama.

First, the money: The Perkins Coie counsel informed us that the hard copies of the documents would cost CRP $428.60, plus an estimated $20 for postage. Collecting our jaws from the floor, we politely asked if there was a decimal error in the price cited. IRS regulations permit groups to charge a “reasonable fee for any reproduction and mailing costs.” But we’ve never been hit with a fee of more than about $20.

When Reese confirmed that all decimals had indeed been correctly placed, we informed them that we would be coming to their office in person to collect the documents, as permitted by IRS regulations. At least we wouldn’t have to pay to ship reams of paper from their D.C. office to our D.C. office just blocks away.

On Friday, April 25, Reese accepted our invitation to come by and pick up the $428 package of documents the following week. He was a little dubious, though, that a Monday morning appointment would allow him enough time to print them. We responded:

We would gladly accept the electronic file in lieu of the printed version, to avoid both the unnecessary printing and the incredible cost of doing so — especially since we’re just going to rescan the whole thing anyway.

However, if you don’t feel that this case is exceptional enough — despite the extraordinary length of the document — to waive the policy of providing hard copies, do you think you can have it printed out by 5PM on Monday?

Thank you, and I hope you’re enjoying this beautiful weekend weather.

Reese said he thought 5 p.m. Monday would give him enough time to needlessly print the electronic file.

On recon duty the day of the pickup was the exceedingly polite and friendly Dr. Sarah Bryner, research director at CRP. Upon arriving at the Perkins Coie office, Sarah was received in a manner that can best (or, at least, euphemistically) be described as “chilly.” She sat patiently in silence as people next to her in the waiting area were welcomed warmly and offered beverages. Hardly anyone spoke to Sarah.

Approximately 11 minutes after Sarah began waiting for the documents, we were informed via email — remember, everyone in the law office was busy not speaking directly to Sarah — that the documents were not ready.

Six minutes after that, further catastrophe: An email from Reese saying that “unfortunately now the copier is jammed.” He apologized for making us wait for him to pointlessly print out the 1024 documents, and then said “I think this has to wait until tomorrow – my personnel are leaving for the day. My apologies for making you wait.”

In the hour that followed, Sarah and the American Bridge counsel discussed over email — in accordance with their Don’t Talk Directly to Sarah policy — whether she could pay for the part of the document that had been printed and when the remainder would be ready. Sarah assured them that she was in no rush, and could wait to see if the 1024 finished printing.

As the staff left the office, Sarah was unceremoniously moved to the main lobby of the building to wait alone.

Finally, at about 6:15, Reese exited the elevator with two accordion folders containing a physical manifestation of everything that is wrong with how public documents are made available under the current system. Sarah handed him the check. He shoved it into his pocket.

So, what was in the costly document? Every single page of American Bridge’s website, which took 2,048 pages. Another 94 pages contained the 1024 application itself, the group’s articles of incorporation in the District of Columbia and its lease agreement. The last page was correspondence from the IRS itself, saying the agency was “pleased to inform you that upon review of your application for tax exempt status we have determined that you are exempt from Federal income tax under section 501(c)(4) of the Internal Revenue Code.”

Robert joined the Center in August 2011 as the outside spending and PACs researcher. In 2012, he started CRP's Politically Active Nonprofits project, which tracks the financial networks of "dark money" groups, mainly 501(c)(4) and 501(c)(6) organizations. In 2014, he won, with colleague Viveca Novak, the Society of Professional Journalists' Sigma Delta Chi Award for Public Service in Online Journalism for a series of stories published on OpenSecrets Blog. Robert has a masters in U.S. foreign policy from American University. Before coming to Washington, D.C., he lived, studied and worked for several years in France and Taiwan, traveling extensively in Europe and Asia. He is originally from Charleston, SC.

Media Contact

Viveca Novak
(202) 354-0111
press@crp.org

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